All else equal, an increase in the rate of inflation ________ aggregate spending and ________ short-run equilibrium output.
A. increases; decreases
B. increases; increases
C. decreases; decreases
D. decreases; increases
Answer: C
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Refer to Exhibit 11-4. If a person’s taxable income is $30,000, how much does he pay in taxes?
A. $4,850 B. $1,400 C. $3,900 D. $4,345
If price is above the average variable cost but below the average total cost of a representative firm in a competitive industry
a. There will be new industries blooming over time b. There will be an interest in the industry over time c. There will be an exit from the industry over time d. All of the above e. None of the above
Refer to Scenario 12.1 At the assumed annual inflation rate of 5 percent, approximately how much will the $6.00 pack of cigarettes cost in 10 years, when Jennifer reaches the age of 35?
A) $8 B) $10 C) $16 D) $23
The "anchor" that sustains the credibility of monetary policy is ________
A) easily weighed during the slightest of macroeconomic storms B) composed of some indestructible substance C) necessary to avoid central bank independence D) available for scrutiny to all who care to observe